by Joan Flocks, Sean P. Lynch II, and Andréa M. Szabo
Heirs’ property refers to a type of tenancy in common in which multiple owners obtain undivided, fractional interests in real property. It often occurs through intestate succession and can leave heirs with clouded titles and unstable property ownership. Tenancies in common have no rights of survivorship; when a cotenant dies, their interest passes directly to their heir(s). All cotenants enjoy the same rights to enjoy and possess the property, but do not share any equal obligations for property maintenance. The lack of clear title and fractioned ownership limits the ability of an individual cotenant to sell, improve, renovate, and repair the property or use it as collateral.1
Studies have shown that heirs’ property issues disproportionately affect African-American households, particularly in low-income communities.2 Much of the research has focused on rural landowners and the risk of land loss, and it is noted that this problem is especially prevalent in the southeastern United States.3 There has been less discussion on the issue in nonrural settings, where it can be especially problematic, as many land parcels are small and, thus, difficult to meaningfully divide.4
This article describes the status of heirs’ property in Florida and its disproportionate impact on low-income communities of color, illustrated by an example from one county in North Central Florida. It details the problems that can arise for homeowners as a result of heirs’ property. Finally, it outlines preventive, corrective, and legislative measures to address the issue.
Heirs’ Property in Florida
In the U.S., each state determines its own probate and intestacy rules. Invalid wills can be particularly problematic in a strict compliance state such as Florida, which requires witnesses and attestation clauses while disallowing oral and holographic wills.5 With an intestate estate in Florida, when there is no surviving spouse of a decedent, real property is distributed per stirpes to heirs as tenants in common — the default form of co-owned property.6 If there is no immediate heir, a share follows equal interest in patriarchal and matriarchal lineal descent.7 Unless the court partitions the property, or the heirs come to an agreement to divide the property, each heir has a right to use the entire property. The problem becomes increasingly complex as more generations pass and heirs beget heirs, which further divides the property.
Many protections are available to heirs who inherit property through a will, but not to those who inherit property through intestacy or invalid means such as informal gifts, oral or holographic wills, or wills that do not comply with state law. Yet creating a will can be a complex endeavor requiring legal knowledge or the means to afford legal assistance.8 Because of this cost, intestacy is often associated with poverty and, according to one finding, “where pockets of poverty and low education persist, the economic and social effects of the laws of intestacy are likely to be relatively widespread and intense.”9 With all the restrictions on heirs’ property, it is no surprise that absentee ownership, low land value, lack of recent sale information, and lack of current improvement information tend to signal a property is owned by heirs.10
The effects of intestacy on low-income communities of color can be illustrated by the case of Alachua County, in North Central Florida. According to the U.S. Census, Alachua County had 115,541 households as of July 1, 2016, and 53.7 percent of these are owner-occupied.11 A search at the Alachua County Property Appraiser’s office indicated there are 1,610 heirs’ properties (2.62 percent) in the county.12 A map of southeastern counties compiled by the Federal Reserve Bank of Atlanta designates those with rates of heirs’ property of more than 2.41 percent as those at the highest risk.13
A preliminary search of the Alachua County heirs’ property revealed that 833 are in Gainesville (population 131,591); 156 in High Springs (population 5,941); 140 in Hawthorne (population 1,525); 113 in Alachua (population 9,893); and 275 are in other areas of the county. Further examination of the 833 heirs’ properties in Gainesville revealed that the areas with the highest impact are several historical working-class, predominately African-American neighborhoods located east or near the east side of town, close to the downtown area. A neighborhood was found to have been highly impacted if the heirs’ properties in that neighborhood exceeded 2 percent of the total heirs’ property in Gainesville.14
Potential Consequences of Heirs’ Property
Problems can arise with heirs’ property when there are familial disputes over what to do with the property. If one heir wishes to mortgage, sell, or rent out the entire property, they must obtain consent from all of the other heirs, yet an heir can sell their individual interest, even to an outsider, without the consent of other heirs.15 Even if there are no disputes over the property, some heirs may be unaware of their ownership interest or be difficult to locate, placing restraints on the property rights of all other heirs. Banks and lenders will not accept fractional interests of tenancies in common as collateral to secure a loan or mortgage.16 Title insurance companies also require clear title for insurance purposes prior to a sale and heirs’ property is not considered clear until all heirs consent to the sale.17 This also becomes problematic if one heir wants to buy out the other heirs but cannot secure the funds because mortgage companies often will not accept a fractional interest as collateral even in a partition sale.18 The Uniform Law Commission (ULC) has recognized that this problem may lead to heirs becoming homeless if they are forced to sell the property and are unable to secure the funds for a buyout of the other heirs’ interests.19
Other common problems are dividing the responsibility for property taxes and maintenance and obtaining financing for renovations and repair. Low-income heirs may have difficulty paying taxes and maintaining a property.20 Under Florida law, heirs pay their share of taxes based on their per stirpes interest, but heirs who are unaware of their ownership interest may also be unaware of their tax obligations.21 Also, state and federal housing assistance programs and private lenders are not likely to approve any funding or assistance for home renovations or repair until the title is clear.22
There are several ways in which heirs’ property owners can lose their property or the value of their interests. For example, in communities experiencing gentrification, a developer may acquire properties (including heirs’ property) owing back taxes through tax deed sales.23 Or, a single heir can sell their fractional interest to an investor or, in some cases, lose it involuntarily to a creditor; the outside investor or creditor then becomes a tenant in common and can petition the court for a partition sale to receive their fractional interest.24 In Florida, partition of property is governed by F.S. Ch. 64.25 In resolving a partition action, a court will order partition in kind or partition by sale. Partition in kind divides the property into subparcels that are proportionate in value to each cotenants interest.26 However, this is usually not practical with homes or small urban properties that cannot be meaningfully divided. After a judgment of partition is made, a Florida court appoints a three-person commission to report on whether partition in kind can be made without prejudice to the owners.27
If the commission finds the property is indivisible and partition in kind cannot be made without prejudice to the owners, and the court agrees, the court can appoint a magistrate or clerk to make a partition by sale;28 the property is forcibly sold in its entirety and the proceeds distributed among cotenant in proportion to their ownership interests.29 Unfortunately, for heirs’ property owners, if a partition by sale occurs, Florida statutes dictate that costs for commissioners, attorneys, and taxes be paid out of the purchase money.30 These payments occur before the property cotenants receive their shares and can diminish the value of their interests.
Potential Remedies to Heirs’ Property
There are a number of advocacy organizations in the Southeast that address the region’s concentration of heirs’ property through education, outreach, technical assistance and training, national advocacy, coalition building, litigation, and direct legal services for individuals.31 Those who assist heirs’ property owners through the legal system use a variety of strategies.
• Preventive Measures — The best way to avoid heirs’ property issues is to create a valid will, leaving beneficiaries with clear, merchantable titles. Yet, it is reported that six out of 10 American adults do not have wills, claiming that they “haven’t gotten around to it” or they “don’t have enough assets.”32 Even if the sole or main asset is a house, however, creating a will is important to avoid intestacy and promoting the importance of wills in vulnerable communities can raise awareness to the issues inherent to heirs’ property. In Florida, some legal service organizations provide clinics and workshops that deal primarily in estate planning.33 In other states, there are not-for-profit organizations that focus specifically on heirs’ property issues. For example, the Georgia Heirs’ Property Law Center, Inc., is “dedicated to increasing generational wealth, social justice, and community stability, by securing and preserving property rights of low and moderate income Georgians.”34 To accomplish this, the center helps transfer generational wealth by assisting with financial and estate planning, probate, clearing titles, and consolidating property ownership.35
• Corrective Measures — Heirs’ property issues can be remediated through corrective measures. Creating a family land trust may alleviate some issues with larger properties in rural settings but may not be practical for small acreages or urban homes. The Center for Heirs’ Property Preservation in South Carolina, another nonprofit law firm dealing primarily with heirs’ property, recommends that as soon as an individual dies intestate or a property is recognized as heirs’ property, that descendants create a family tree, locate all potential tenants in common, and together attempt to gain consensus in writing on what to do with the property.36 Such agreements can disentangle interests and responsibilities, offer clarity, result in more equitable and flexible arrangements, preserve familial attachment to the property, avoid impersonal court solutions such as partition sales, and avoid costs associated with court-ordered partition by sale. However, heirs may need the assistance of professionals to accomplish this.
A suit for adverse possession is the last option for heirs who cannot get clear title. This is the least practical course because an heir must first live on the property for seven years according to specific conditions, pay all taxes, and engage in potentially costly court action.37 For some heirs, however, a claim for adverse possession may be the only alternative to losing or not being able to finance maintenance on the property.
• Protection from Creditors through the Florida Homestead Exemption — The Florida Supreme Court has held that the homestead provision be liberally construed in favor of protecting homestead property.38 In Public Health Trust of Dade County v. Lopez, 531 So. 2d 946 (Fla. 1988), the court stated, “As a matter of public policy, the purpose of the homestead exemption is to promote the stability and welfare of the state by securing to the householder a home, so that the homeowner and his or her heirs may live beyond the reach of financial misfortune and the demands of creditors who have given credit under such law.”39 In Snyder v. Davis, 699 So. 2d 999, 1002 (Fla. 1997), the court compared the state’s homestead provision to similar provisions in other jurisdictions and stated that “in Florida, the homestead provision is in place to protect and preserve the interest of the family in the family home.”
Thus, tenants in common who qualify for homestead40 may receive tax exemptions and be protected from forced sale by creditors under certain, albeit limited, conditions. For a tenant in common to qualify for a homestead tax exemption, they must first be residing permanently on the property.41 The homestead exemption can reduce the taxable value of the property by up to a maximum of $25,000, but the amount of exemption that one residential tenant in common can claim depends on their individual portion of ownership interest.42 A tenant in common’s protection from a creditor’s action is likewise limited. According to the Florida Constitution, in order to be protected against forced sale by creditors, a homestead cannot exceed certain acreage limits and must be the residence of the owner(s) claiming the protection.43
In the case of heirs’ property, the residency requirement can prove to be problematic because the exemption from forced sale can only adhere to a tenant in common if they are living on the property; the interests of any other tenants in common who do not live on the property are not protected from creditors.44 Thus, a creditor can foreclose on the interest of a debtor tenant in common who does not qualify for the homestead creditor exemption (because, for example, they do not reside on the property or are unaware of their ownership interest), take an interest in an heirs’ property homestead, and then force a sale of the property.45
Furthermore, the homestead creditor exemption does not extend to forced sale by a tenant in common. In Tullis v. Tullis, 360 So. 2d 375, 377-78 (Fla. 1978), the Florida Supreme Court held that constitutional provisions concerning homestead exemption did not preclude a tenant in common from suing for partition and obtaining a forced sale in order to obtain the beneficial enjoyment of her interest in the property when the parties agree the property is indivisible. Thus, there is nothing to prevent a debtor tenant in common from using their ownership interest in heirs’ property to satisfy a debt.
• Protection Under the Uniform Partition of Heirs Property Act — In 2010, the ULC approved the Uniform Partition of Heirs Property Act (UPHPA) with a prefatory note and comments and recommended its enactment in all states.46 The UPHPA was developed after research revealed that the existence of heirs’ property is common enough to warrant such legislation and that heirs’ property owners do not fully understand the vulnerability of their interests.47 The ULC found that many partition sale auctions operate under forced sale procedures that are “notorious for yielding sales prices well below market value,” which contributed to the loss of wealth among heirs’ property owners by depriving them of the fair market value of their interests.48 The UPHPA attempts to remedy this by requiring an appraisal before a partition49 and by requiring partitions by sale to occur on the open market unless the court-set terms and conditions of sales in sealed bids or an auction are more economically advantageous and in the best interest for all the tenants in common.50 The ULC found that although many states have a statutory preference for partition in kind, there is a de facto preference for partition by sale partly because courts consider the economic benefit of a sale to be a preferred wealth-maximizing option for the heirs.51 The UPHPA attempts to remedy this situation by 1) including clear language preferring a partition in kind; and 2) imposing several factors a court must consider before ordering a partition by sale, including the noneconomic value of property.52 A court may order a partition by sale only after a review of relevant factors demonstrates a partition in kind will result in manifest prejudice.53 In an attempt to alleviate the problem of one tenant in common forcing a court-ordered partition of heirs’ property, the UPHPA contains a cotenant buyout provision. This provision requires that upon notice of a cotenant’s intent to request a partition by sale, all other cotenants are given the opportunity to buy out the remainder interests before a court begins the process.54 The UPHPA still preserves the right of any cotenant to file for a partition and makes no adjustments in current laws on attorneys’ fees.
According to the ULC, 11 states have already passed the UPHPA, including several southeastern states.55 Additionally, four states and the District of Columbia are introducing legislation and considering adoption of the UPHPA in 2018.56 Yet, no attempts have been made in Florida to pass a bill like the UPHPA.57
Heirs’ property disproportionately impacts low-income communities of color and is prevalent throughout the Southeast United States.58 Federal law and Florida partition, intestacy, and homestead laws do not afford enough protection for tenants in common holding heirs’ property, resulting in the loss of homes and wealth in these communities. The legal default rules governing forced sale procedures are often not wealth maximizing and some heirs’ property owners may even be left homeless after a sale. Heirs’ property owners are vulnerable when they are unaware of the practical realities involved with tenancies in common, particularly in nonrural settings with small, indivisible properties. There are a number of preventative and corrective measures that can be taken, however, and many states have adopted legislation based on the UPHPA, which may mitigate some of the detrimental effects of heirs’ property through tactics such as offering right of first refusal to heirs and requiring pre-sale fair market property appraisal. Many Florida counties have high rates of heirs’ property, and more focus on the impact of these unstable forms of property ownership is warranted.q
1 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act 1-4 (2010), available at http://www.uniformlaws.org/shared/docs/partition%20of%20heirs%20property/uphpa_final_10.pdf; B. James Deaton, A Review and Assessment of the Heirs Property Issue in the United States, 46 J. Econ Issues 615, 616-619 (2012).
2 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act at 4-5.
3 Id. Despite the problems associated with heirs’ property ownership, there have been several studies focused on the reluctance of heirs’ property owners to obtain clear title because of deep symbolic social and cultural attachment to ancestral land. Sarah Hitchner, et al., “A Privilege and a Challenge”: Valuation of Heirs’ Property by African American Landowners and Implications for Forest Management in the Southeastern U.S., 16 Small-scale Forestry 395, 397-399 (2017).
4 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act at 6.
5 Fla. Stat. §732.502. A testator must be in strict compliance with statutory requirements to create a valid will. Allen v. Dalk, 826 So. 2d 245, 246 (Fla. 2002).
6 Fla. Stat. §§732.102-104 and 689.15.
7 Fla. Stat. §732.103(1)-(6).
8 Reid Kress Weisbord, Wills for Everyone: Helping Individuals Opt Out of Intestacy, 53 B.C.L. Rev. 877, 879 (2012).
9 James Deaton, Intestate Succession and Heir Property: Implications for Future Research on the Persistence of Poverty in Central Appalachia 41 J. Econ. Issues 927, 927-28 (2007).
10 S. Hill, et al., Unlocking Heir Property Ownership: Assessing the Impact on Low and Mid-Income Georgians and Their Communities, Georgia Appleseed Center for Law and Justice (2013).
11 U.S. Census Bureau, QuickFacts — Alachua County, Florida, https://www.census.gov/quickfacts/fact/table/alachuacountyflorida/PST045216.
12 Author searched for these properties by entering the word “heirs” into the space for “name” in the “Owner Name” field at the Alachua County Property Appraiser website, http://www.acpafl.org/search.html.
13 Ann Carpenter, et al., Understanding Heirs’ Properties in the Southeast (Mar./Apr. 2016), available at https://www.frbatlanta.org/community-development/publications/partners-update/2016/02/160419-understanding-heirs-properties-in-southeast.aspx.
14 See note 12. After the author found the list of heirs’ properties in Alachua County, they were sorted according to town. Of the 833 heirs’ properties in the city of Gainesville, there are 217 properties in the southeast quadrant, 113 properties in the southwest quadrant, 244 properties in the northwest quadrant, and 259 properties in the northeast quadrant. In terms of historically black Gainesville neighborhoods, there are 57 properties in Lincoln Estates, 38 in Duval/Cedar Grove, 22 in Browns area, 20 in the Pleasant Street area, and 17 in the Porters area. This finding of the prevalence of heirs’ properties in these particular neighborhoods was supported in an interview with Scott Winzeler, executive director of the Alachua Habitat for Humanity, Interview at Gainesville 4 All General Body Meeting (Oct. 23, 2017).
15 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act at 1.
16 U.S. Dep’t of Agriculture, Office of the Assistant Secretary for Civil Rights: What You Need to Know about Heir Property, https://www.fsa.usda.gov/Internet/FSA_File/whatyouneedtoknowheirproperty.pdf.
18 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act at 8.
20 See note 16.
21 Many of the addresses listed as the taxpayer for heirs’ property found on Alachua County Property Appraiser’s website were from out of state, including addresses in Georgia, South Carolina, North Carolina, New York, New Jersey, Illinois, Michigan, and Wisconsin.
22 Heather K. Way, Informal Homeownership in the United States and the Law, 29 St. Louis U. Pub. L. Rev. 113, 158 (2009).
23 Fla. Stat. §§197.502 and 197.542; Craig H. Baab, Heir Property: A Constraint for Planners, an Opportunity for Communities, 63 Planning & Envtl. L. 3, 7 (2011).
24 Fla. Stat. §64.031; Baab, Heir Property: A Constraint for Planners, an Opportunity for Communities at 8; Joseph Percopo, The Impact of Co-Ownership on Florida Homestead, 86 Fla. Bar J. 32 (May 2012), available at https://www.floridabar.org/news/tfb-journal/?durl=%2FDIVCOM%2FJN%2FJNJournal01.nsf%2FArticles%2F4F91799F4647A72B852579F0006347D1.
25 Fla. Stat. §§64.011-64.091 (2017)
26 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act at 1-2.
27 Fla. Stat. §64.061 (2017). In Florida no partition may take place even if Florida law technically allows for a partition if the partition will result in “manifest injustice, fraud, or oppression.” Condrey v. Condrey, 92 So. 2d 423, 426 (Fla. 1957).
28 Fla. Stat. §64.061(4).
29 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act at 2.
30 Fla. Stat. §§64.061(2) and 64.081.
31 Hitchner, et al., “A Privilege and a Challenge” at 396-397. “A short list includes the National Black Farmers Association, Federation of Southern Cooperatives, Limited Resource Landowner Education and Assistance Network (LRLEAN), The Land Loss Prevention Project, Center for Heirs Property Preservation, Georgia Appleseed Center for Law and Justice, Alabama Appleseed Center for Law and Justice, and the newly established Georgia Heirs Property Law Center, in addition to other organizations and state agencies and associations that also support these goals.” Id. There is no single organization focused exclusively on addressing heirs’ property in Florida. However, in 2017, Bay Area Legal Services received funding to initiate the “No Place Like Home Project,” which aims to train attorneys on assisting homeowners obtain clear titles. Jim Ash, BALS’ No Place Like Home Project Provides Services Before the Storm, Fla. Bar News, Dec. 15, 2017, available at https://www.floridabar.org/news/tfb-news/?durl=%2Fdivcom%2Fjn%2Fjnnews01.nsf%2F8c9f13012b96736985256aa900624829%2F4cc59235d14f8eef852581e90051ea02.
32 Barbranda Lumpkins Wall, Haven’t Done a Will Yet? AARP, https://www.aarp.org/money/investing/info-2017/half-of-adults-do-not-have-wills.html.
33 For example, in the Alachua County area, Three Rivers Legal Services, Inc., provides resources focused on elder law and end-of-life planning. However, the organization does not provide aid focused specifically on heirs’ property issues. See Three Rivers Legal Services, elder law and end-of-life planning, http://www.trls.org/Elder-Law/.
34 Georgia Heirs Property Law Center, https://www.gaheirsproperty.org/.
36 Center for Heirs Property Preservation, http://www.heirsproperty.org/.
37 Fla. Stat. §95.18.
38 Snyder v. Davis, 699 So. 2d 999, 1002 (Fla. 1997).
39 Public Health Trust, 531 So. 2d at 948. Furthermore, the Public Health Trust court held, “The homestead protection has never been based upon principles of
equity, see Bigelow, but always has been extended to the homesteader and, after his or her death, to the heirs whether the homestead was a 22-room mansion or a two-room hut and whether the heirs were rich or poor.” Id. at 951.
40 Fla. Const. art. X, §4(a)-(c).
41 Fla. Const. art VII, §6
42 Fla. Stat. §196.031(1)(a). No house, family unit, or individual is entitled to more than one homestead tax exemption and if more than one tenant in common resides on a property, each of their exemption amount is limited to their proportionate ownership interest. Fla. Admin. Code R. 12D-7.012.
43 Fla. Const. art. X, §4(a)-(c).
44 Percopo, The Impact of Co-Ownership on Florida Homestead.
46 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act, Prefatory Note at 1-2.
47 Id. at 4.
48 Id. at 2.
49 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act at §6(a)-(g).
50 Id. at §10 (a), (e).
51 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act, Prefatory Note at 2.
52 Nat’l Conference of Commissioners on Uniform State Laws, Uniform Partition of Heirs Property Act at §§8 and 9.
53 Id. at §8(a).
54 Id. at §7(a)-(g).
55 Uniform Law Commission, Legislative Enactment Status: Partition of Heirs Property Act (Nov. 2017), http://www.uniformlaws.org/LegislativeMap.aspx?title=Partition%20of%20Heirs%20Property%20Act. States that have enacted the UPHPA are Alabama, Arkansas, Connecticut, Georgia, Hawaii, Iowa, Montana, New Mexico, Nevada, South Carolina, and Texas.
56 Id. These are Kansas, Mississippi, Tennessee, West Virginia, and the District of Columbia.
57 Discussion with Florida Senate staff revealed they were unaware of the UPHPA or of any efforts to pass similar legislation in Florida. Telephone interviews with Tom Yeatman, 2017 staff director for Senate Committee of Community Affairs, and Tom Cibula, staff director for Senate Committee on Judiciary (Oct. 13, 2017).
58 Thomas W. Mitchell, From Reconstruction to Deconstruction: Undermining Black Ownership, Political Independence, and Community through Partition Sales of Tenancy in Common Property. 95 Northwestern L. Rev. 505, 505-506 (2009).
JOAN FLOCKS, M.A., J.D., is the director of social policy for the Center for Governmental Responsibility at the University of Florida Levin College of Law, where she teaches courses in social justice lawyering and poverty law. She was previously an assistant professor at the UF College of Medicine and has worked for many years as a legal services attorney in Florida. Flocks’ areas of funded research include occupational and environmental health, vulnerable populations, and community resiliency.
ANDRÉA M. SZABO, M.S., J.D., is a 2018 graduate with a joint degree in law and interdisciplinary ecology from the University of Florida Levin College of Law and School of Natural Resources and Environment.
SEAN P. LYNCH II, J.D., is a 2018 graduate of the University of Florida Levin College of Law.